Form U-13-60
Mutual and Subsidiary Service Companies
Revised February 7, 1980
ANNUAL REPORT
FOR THE PERIOD
Beginning January 1, 1996 and Ending December 31, 1996
TO THE
U. S. SECURITIES AND EXCHANGE COMMISSION
OF
American Electric Power Service Corporation
(Exact Name of Reporting Company)
A Subsidiary Service Company
Date of Incorporation December 17, 1937. If not Incorporated,
Date of Organization
State or Sovereign Power under which Incorporated or Organized
New York
Location of Principal Executive Offices of Reporting Company
1 Riverside Plaza, Columbus, Ohio 43215
Name, title, and address of officer to whom correspondence
concerning this report should be addressed:
1 Riverside Plaza
Gerald R. Knorr Assistant Controller Columbus, Ohio 43215
(Name) (Title) (Address)
Name of Principal Holding Company under which Reporting Company is
organized:
AMERICAN ELECTRIC POWER COMPANY, INC.
<PAGE>
1
INSTRUCTIONS FOR USE OF FORM U-13-60
1. Time of Filing.--Rule 94 provides that on or before the first
day of May in each calendar year, each mutual service company and
each subsidiary service company as to which the Commission shall
have made a favorable finding pursuant to Rule 88, and every
service company whose application for approval or declaration
pursuant to Rule 88 is pending shall file with the Commission an
annual report on Form U-13-60 and in accordance with the Instruc-
tions for that form.
2. Number of Copies.--Each annual report shall be filed in dupli-
cate. The company should prepare and retain at least one extra
copy for itself in case correspondence with reference to the
report becomes necessary.
3. Period Covered by Report.--The first report filed by any
company shall cover the period from the date the Uniform System of
Accounts was required to be made effective as to that company
under Rules 82 and 93 to the end of that calendar year. Sub-
sequent reports should cover a calendar year.
4. Report Format.--Reports shall be submitted on the forms pre-
pared by the Commission. If the space provided on any sheet of
such form is inadequate, additional sheets may be inserted of the
same size as a sheet of the form or folded to such size.
5. Money Amounts Displayed.--All money amounts required to be
shown in financial statements may be expressed in whole dollars,
in thousands of dollars or in hundred thousands of dollars, as
appropriate and subject to provisions of Regulation S-X
(S210.3-01(b)).
6. Deficits Displayed.--Deficits and other like entries shall be
indicated by the use of either brackets or a parenthesis with
corresponding reference in footnotes. (Regulation S-X,
S210.3-01(c)).
7. Major Amendments or Corrections.--Any company desiring to
amend or correct a major omission or error in a report after it
has been filed with the Commission shall submit an amended report
including only those pages, schedules, and entries that are to be
amended or corrected. A cover letter shall be submitted request-
ing the Commission to incorporate the amended report changes and
shall be signed by a duly authorized officer of the company.
8. Definitions.--Definitions contained in Instruction 01-8 to the
Uniform System of Accounts for Mutual Service Companies and Sub-
sidiary Service Companies, Public Utility Holding Company Act of
1935, as amended February 2, 1979 shall be applicable to words or
terms used specifically within this Form U-13-60.
9. Organization Chart.--The service company shall submit with
each annual report a copy of its current organization chart.
(Cont'd)
<PAGE>
1A
INSTRUCTIONS FOR USE OF FORM U-13-60
10. Methods of Allocation.--The service company shall submit with
each annual report a listing of the currently effective methods of
allocation being used by the service company and on file with the
Securities and Exchange Commission pursuant to the Public Utility
Holding Company Act of 1935.
11. Annual Statement of Compensation for Use of Capital Billed.--
The service company shall submit with each annual report a copy of
the annual statement supplied to each associate company in support
of the amount of compensation for use of capital billed during the
calendar year.
<PAGE>
2
LISTING OF SCHEDULES AND ANALYSIS OF ACCOUNTS
Page
Number
Schedule
Description of Schedules and Accounts or Account
Number
COMPARATIVE BALANCE SHEET Schedule I 4-5
SERVICE COMPANY PROPERTY Schedule II 6-7
ACCUMULATED PROVISION FOR
DEPRECIATION AND AMORTIZATION
OF SERVICE COMPANY PROPERTY Schedule III 8
INVESTMENTS Schedule IV 9
ACCOUNTS RECEIVABLE FROM ASSOCIATE
COMPANIES Schedule V 10
FUEL STOCK EXPENSES UNDISTRIBUTED Schedule VI 11
STORES EXPENSE UNDISTRIBUTED Schedule VII 12
MISCELLANEOUS CURRENT AND ACCRUED
ASSETS Schedule VIII 13
MISCELLANEOUS DEFERRED DEBITS Schedule IX 14
RESEARCH, DEVELOPMENT, OR DEMONSTRATION
EXPENDITURES Schedule X 15
PROPRIETARY CAPITAL Schedule XI 16
LONG-TERM DEBT Schedule XII 17
CURRENT AND ACCRUED LIABILITIES Schedule XIII 18
NOTES TO FINANCIAL STATEMENTS Schedule XIV 19
COMPARATIVE INCOME STATEMENT Schedule XV 20
ANALYSIS OF BILLING - ASSOCIATE
COMPANIES Account 457 21
ANALYSIS OF BILLING - NONASSOCIATE
COMPANIES Account 458 22
ANALYSIS OF CHARGES FOR SERVICE -
ASSOCIATE AND NONASSOCIATE COMPANIES Schedule XVI 23
SCHEDULE OF EXPENSE BY DEPARTMENT OR
SERVICE FUNCTION Schedule XVII 24-25
DEPARTMENTAL ANALYSIS OF SALARIES Account 920 26
OUTSIDE SERVICES EMPLOYED Account 923 27
EMPLOYEE PENSIONS AND BENEFITS Account 926 28
GENERAL ADVERTISING EXPENSES Account 930.1 29
MISCELLANEOUS GENERAL EXPENSES Account 930.2 30
RENTS Account 931 31
TAXES OTHER THAN INCOME TAXES Account 408 32
DONATIONS Account 426.1 33
OTHER DEDUCTIONS Account 426.5 34
NOTES TO STATEMENT OF INCOME Schedule XVIII 35
<PAGE>
3
LISTING OF INSTRUCTIONAL FILING REQUIREMENTS
Page
Number
Description of Reports or Statements
ORGANIZATION CHART 36
METHODS OF ALLOCATION 37
ANNUAL STATEMENT OF COMPENSATION FOR USE OF
CAPITAL BILLED 38
SIGNATURE CLAUSE 39
<PAGE>
4
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
SCHEDULE I - COMPARATIVE BALANCE SHEET
Give balance sheet of the company as of December 31 of the current and prior year.
ACCOUNT ASSETS AND OTHER DEBITS AS OF DECEMBER 31
CURRENT PRIOR
(In Thousands)
<S> <C> <C>
SERVICE COMPANY PROPERTY
101 Service company property (Schedule II) $222,939 $206,936
107 Construction work in progress (Schedule II) 229 --
Total Property 223,168 206,936
108 Less accumulated provision for depreciation and
amortization of service company property
(Schedule III) 84,693 71,174
Net Service Company Property 138,475 135,762
INVESTMENTS
123 Investments in associate companies (Schedule IV) -- --
124 Other investments (Schedule IV) 23.578 13,476
Total Investments 23,578 13,476
CURRENT AND ACCRUED ASSETS
131 Cash 17 10
134 Special deposits 132 126
135 Working funds 508 271
136 Temporary cash investments (Schedule IV) -- --
141 Notes receivable 115 57
143 Accounts receivable 1,025 134
144 Accumulated provision for uncollectible
accounts -- --
146 Accounts receivable from associate
companies (Schedule V) 88,742 70,511
152 Fuel stock expenses undistributed (Schedule VI) -- --
154 Materials and supplies -- --
163 Stores expense undistributed (Schedule VII) -- --
165 Prepayments 1,880 1,720
174 Miscellaneous current and accrued
assets (Schedule VIII) 10 4
Total Current and Accrued Assets 92,429 72,833
DEFERRED DEBITS
181 Unamortized debt expense 5,844 6,520
184 Clearing accounts -- --
186 Miscellaneous deferred debits (Schedule IX) 6,924 6,750
188 Research, development, or demonstration
expenditures (Schedule X) -- --
190 Accumulated deferred income taxes 31,287 20,420
Total Deferred Debits 44,055 33,690
TOTAL ASSETS AND OTHER DEBITS $298,537 $255,761
Note: Unamortized Debt Expense includes unamortized loss on reacquired debt of
$5,772,000 at December 31, 1996 and $6,439,000 at December 31, 1995.
</TABLE>
<PAGE>
5
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
SCHEDULE I - COMPARATIVE BALANCE SHEET
ACCOUNT LIABILITIES AND PROPRIETARY CAPTIAL AS OF DECEMBER 31
CURRENT PRIOR
(In Thousands)
<S> <C> <C>
PROPRIETARY CAPITAL
201 Common stock issued (Schedule XI) $ 1,350 $ 1,350
211 Miscellaneous paid-in-capital (Schedule XI) -- --
215 Appropriated retained earnings (Schedule XI) -- --
216 Unappropriated retained earnings (Schedule XI) -- --
Total Proprietary Capital 1,350 1,350
LONG-TERM DEBT
223 Advances from associate companies (Schedule XII) 1,100 1,100
224 Other long-term debt (Schedule XII) 75,000 80,000
225 Unamortized premium on long-term debt -- --
226 Unamortized discount on long-term debt-debit -- --
Total Long-term Debt 76,100 81,100
OTHER NONCURRENT LIABILITIES
227 Obligations under capital leases - Noncurrent 32,670 24,660
224.6 Other 54,752 31,422
Total Other Noncurrent Liabilities 87,422 56,082
CURRENT AND ACCRUED LIABILITIES
231 Notes payable 3,318 4,284
232 Accounts payable 17,498 8,214
233 Notes payable to associate companies
(Schedule XIII) -- --
234 Accounts payable to associate companies
(Schedule XIII) 30,132 33,812
236 Taxes accrued 6,865 3,807
237 Interest accrued 401 389
238 Dividends declared -- --
241 Tax collections payable 3,101 259
242 Miscellaneous current and accrued liabilities
(Schedule XIII) 23,404 15,169
243 Obligations under capital leases - Current 10,601 12,115
Total Current and Accrued Liabilities 95,320 78,049
DEFERRED CREDITS
253 Other deferred credits 9,785 10,951
255 Accumulated deferred investment tax credits 1,105 1,152
Total Deferred Credits 10,890 12,103
282 ACCUMULATED DEFERRED INCOME TAXES 27,455 27,077
TOTAL LIABILITIES AND PROPRIETARY CAPITAL $298,537 $255,761
Note: Other long-term debt includes $5,000,000 due within one year (See note 7,
Schedule XIV). Other Other noncurrent liabilities includes amounts due
within one year of $671,000 at December 31, 1996 and $653,000 at December 31,
1995.
</TABLE>
<PAGE>
6
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
SCHEDULE II - SERVICE COMPANY PROPERTY
BALANCE AT RETIREMENTS OTHER BALANCE AT
BEGINNING ADDITIONS OR CHANGES 1/ CLOSE OF
DESCRIPTION OF YEAR SALES YEAR
(In Thousands)
SERVICE COMPANY PROPERTY
Account
<S> <C> <C> <C> <C> <C>
301 ORGANIZATION $ -- $ -- $ -- $ -- $ --
303 MISCELLANEOUS
INTANGIBLE PLANT -- -- -- -- --
304 LAND AND LAND RIGHTS 5,108 -- -- -- 5,108
305 STRUCTURES AND
IMPROVEMENTS 140,719 -- -- -- 140,719
306 LEASEHOLD IMPROVEMENTS 234 -- -- -- 234
307 EQUIPMENT 2/ -- -- -- -- --
308 OFFICE FURNITURE AND
EQUIPMENT 1,019 -- -- -- 1,019
309 AUTOMOBILES, OTHER
VEHICLES AND RELATED
GARAGE EQUIPMENT -- -- -- -- --
310 AIRCRAFT AND AIRPORT
EQUIPMENT -- -- -- -- --
311 OTHER SERVICE COMPANY
PROPERTY 3/ 59,856 21,904 5,901 -- 75,859
SUB-TOTAL 206,936 21,904 5,901 -- 222,939
107 CONSTRUCTION WORK IN
PROGRESS 4/ -- 22,133 -- (21,904) 229
TOTAL $206,936 $44,037 $5,901 $(21,904) $223,168
1/ PROVIDE AN EXPLANATION OF THOSE CHANGES CONSIDERED MATERIAL:
The amount of $21,904,000 represents assets transferred to "in-service"
during 1996.
</TABLE>
<PAGE>
7
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
SCHEDULE II - CONTINUED
2/ SUBACCOUNTS ARE REQUIRED FOR EACH CLASS OF EQUIPMENT OWNED. THE SERVICE
COMPANY SHALL PROVIDE A LISTING BY SUBACCOUNT OF EQUIPMENT ADDITIONS
DURING THE YEAR AND THE BALANCE AT THE CLOSE OF THE YEAR:
BALANCE AT
SUBACCOUNT DESCRIPTION ADDITIONS CLOSE OF YEAR
None
TOTAL $ -0- $ -0-
3/ DESCRIBE OTHER SERVICE COMPANY PROPERTY:
Includes leased assets at December 31, 1996 ($75,836,000) which have been
capitalized in accordance with FASB Statement Nos. 13 and 71 and other owned
assets at December 31, 1996 ($23,000).
4/ DESCRIBE CONSTRUCTION WORK IN PROGRESS:
Improvements to Office Building at 230 N. Columbus St., Lancaster, OH
($192,000) and to Office Building at 5088 Washington St., Cross Lanes, WVA
($37,000).
<PAGE>
8
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
SCHEDULE III
ACCUMULATED PROVISION FOR DEPRECIATION
AND AMORTIZATION OF SERVICE COMPANY PROPERTY
BALANCE AT ADDITIONS OTHER CHANGES BALANCE AT
DESCRIPTION BEGINNING CHARGED RETIREMENTS ADD (DEDUCT) CLOSE OF
OF YEAR TO 1/ YEAR
ACCOUNT 403
Account (In Thousands)
<S> <C> <C> <C> <C> <C>
301 ORGANIZATION $ -- $ -- $ -- $ -- $ --
303 MISCELLANEOUS
INTANGIBLE
PLANT -- -- -- -- --
304 LAND AND LAND
RIGHTS -- -- -- -- --
305 STRUCTURES AND
IMPROVEMENTS 47,781 3,958 -- -- 51,739
306 LEASEHOLD
IMPROVEMENTS 144 13 -- -- 157
307 EQUIPMENT -- -- -- -- --
308 OFFICE
FURNITURE AND
FIXTURES 187 40 -- -- 227
309 AUTOMOBILES,
OTHER VEHICLES
AND RELATED
GARAGE EQUIPMENT -- -- -- -- --
310 AIRCRAFT AND
AIRPORT EQUIPMENT -- -- -- -- --
311 OTHER SERVICE
COMPANY PROPERTY 23,062 15,130 5,622 -- 32,570
TOTAL $71,174 $19,141 $5,622 $ -0- $84,693
1/ PROVIDE AN EXPLANATION OF THOSE CHANGES CONSIDERED MATERIAL:
</TABLE>
<PAGE>
9
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
SCHEDULE IV - INVESTMENTS
INSTRUCTIONS: Complete the following schedule concerning investments.
Under Account 124, "Other Investments", state each investment
separately, with description, including, the name of issuing
company, number of shares or principal amount, etc.
Under Account 136, "Temporary Cash Investments", list each
investment separately.
BALANCE AT BALANCE AT
D E S C R I P T I O N BEGINNING CLOSE
OF YEAR OF YEAR
(In Thousands)
<S> <C> <C>
ACCOUNT 123 - INVESTMENT IN ASSOCIATE COMPANIES
None
ACCOUNT 124 - OTHER INVESTMENTS
Cash Surrender Value of Life
Insurance Policies (net of policy
loans and accrued interest) $ 4,697 $ 5,529
Umbrella Trust 8,677 17,920
Notes Receivable Constructive
Marketing Program 102 129
Sub-Total Other Investments 13,476 23,578
ACCOUNT 136 - TEMPORARY CASH INVESTMENTS
None
TOTAL $13,476 $23,578
</TABLE>
<PAGE>
10
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
SCHEDULE V - ACCOUNTS RECEIVABLE FROM ASSOCIATE COMPANIES
INSTRUCTIONS: Complete the following schedule listing accounts receivable from
each associate company. Where the service company has provided
accommodation or convenience payments for associate companies, a
separate listing of total payments for each associate company by
subaccount should be provided.
<CAPTION>
BALANCE AT BALANCE AT
D E S C R I P T I O N BEGINNING CLOSE
OF YEAR OF YEAR
ACCOUNT 146 - ACCOUNTS RECEIVABLE FROM (In Thousands)
ASSOCIATE COMPANIES
<S> <C> <C>
Associate Companies
AEP Communications, Inc. $ -- $ 211
AEP Energy Services, Inc. 655 212
AEP Energy Solutions, Inc. -- 955
AEP Generating Company 1,237 492
AEP Investments, Inc. -- 4
AEP Pushan Power, LDC -- 37
AEP Resources, Inc. 79 175
AEP Resources International, LTD -- 39
American Electric Power Company, Inc. 94 632
Appalachian Power Company 28,055 36,099
Appalachian Power Company (Commercial PFBC) 18 --
Appalachian/Ohio Power Joint Account (Amos) 84 36
Appalachian/Ohio Power Joint Account (Sporn) 56 1,134
Blackhawk Coal Company/Price River Coal Company 21 4
Cardinal Operating Company 139 1,583
Cedar Coal Co. 26 8
Central Appalachian Coal Company -- 1
Central Coal Company 3 3
Central Ohio Coal Company 194 150
Central Operating Company 23 34
Columbus Southern Power Company 17,224 14,775
Conesville Coal Preparation Company 74 105
SUB-TOTAL 47,982 56,689
<CAPTION>
ANALYSIS OF CONVENIENCE OR ACCOMMODATION PAYMENTS: TOTAL
PAYMENTS
BY COMPANY: (In Thousands)
<S> <C>
Associate Companies
AEP Energy Services, Inc. $ 45
AEP Generating Company 96
AEP Investments, Inc. 1
AEP Resources International (1)
American Electric Power Company, Inc. 490
Appalachian Power Company 327,520
Appalachian/Ohio Power Joint Account (Amos) 185
Appalachian/Ohio Power Joint Account (Sporn) 88
Blackhawk Coal Company/Price River Coal Company 76
Cardinal Operating Company 138
Cedar Coal Co. 77
Central Appalachian Coal Company 49
SUB-TOTAL PAYMENTS 328,764
(Cont'd)
</TABLE>
<PAGE>
10A
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
SCHEDULE V - ACCOUNTS RECEIVABLE FROM ASSOCIATE COMPANIES
INSTRUCTIONS: Complete the following schedule listing accounts receivable from
each associate company. Where the service company has provided
accommodation or convenience payments for associate companies, a
separate listing of total payments for each associate company by
subaccount should be provided.
<CAPTION>
BALANCE AT BALANCE AT
D E S C R I P T I O N BEGINNING CLOSE
OF YEAR OF YEAR
ACCOUNT 146 - ACCOUNTS RECEIVABLE FROM (In Thousands)
ASSOCIATE COMPANIES
<S> <C> <C>
Sub-Total Brought Forward 47,982 56,689
Franklin Real Estate Company -- 1
Indiana Michigan Power Company 8,932 11,247
Indiana Michigan Power/AEP Generating Joint
Account (Rockport) 272 414
Indiana Michigan Power Company-Water Transportation 237 52
Kentucky Power Company 2,626 5,095
Kingsport Power Company 255 628
Ohio Power Company 8,157 12,746
Ohio Power Company-Cook Coal Terminal 130 19
Ohio Power Company (Gavin) 374 165
Ohio Power Company (Tidd PFBC) 1 --
Simco, Inc. -- 2
Southern Appalachian Coal Company 3 1
Southern Ohio Coal Company 627 523
Wheeling Power Company 263 650
Windsor Coal Company 308 193
Statutory Subsidiaries
Indiana-Kentucky Electric Corporation 187 174
Ohio Valley Electric Corporation 157 143
TOTAL $70,511 $88,742
<CAPTION>
ANALYSIS OF CONVENIENCE OR ACCOMMODATION PAYMENTS: TOTAL
PAYMENTS
(In Thousands)
<S> <C>
Sub-Total Brought Forward 328,764
Central Coal Company 5
Central Ohio Coal Company 3,305
Central Operating Company 1,307
Colomet, Inc. 42
Columbus Southern Power Company 138,519
Conesville Coal Preparation Company (87)
Indiana Michigan Power Company 27,625
Indiana Michigan Power/AEP Generating Joint Account (Rockport) 1,065
Indiana Michigan Power Company-Water Transportation 1,345
Kentucky Power Company 6,915
Kingsport Power Company 763
SUB-TOTAL PAYMENTS 509,568
(Cont'd)
</TABLE>
<PAGE>
10B
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
SCHEDULE V - ACCOUNTS RECEIVABLE FROM ASSOCIATE COMPANIES
INSTRUCTIONS: Complete the following schedule listing accounts receivable from
each associate company. Where the service company has provided
accommodation or convenience payments for associate companies, a
separate listing of total payments for each associate company by
subaccount should be provided.
<CAPTION>
BALANCE AT BALANCE AT
D E S C R I P T I O N BEGINNING CLOSE
OF YEAR OF YEAR
ACCOUNT 146 - ACCOUNTS RECEIVABLE FROM
ASSOCIATE COMPANIES
TOTAL
ANALYSIS OF CONVENIENCE OR ACCOMMODATION PAYMENTS: TOTAL
PAYMENTS
(In Thousands)
<S> <C>
Sub-Total Brought Forward 509,568
Ohio Power Company 61,518
Ohio Power Company-Cook Coal Terminal 91
Ohio Power Company (Gavin) 1
Ohio Power Company (Tidd PFBC) 1
Simco, Inc. 36
Southern Appalachian Coal Company 42
Southern Ohio Coal Company 8,478
Wheeling Power Company 632
Windsor Coal Company 471
Statutory Subsidiaries
Indiana-Kentucky Electric Corporation 2
Ohio Valley Electric Corporation 12
TOTAL PAYMENTS $580,852
FOR:
Interchange Power Pool and Transmission Agreement $444,126
Insurances 67,099
Employee Benefit Plans 62,422
Taxes 1,855
Membership Dues 1,494
Legal Fees 1,202
Trustee Fees 1,093
Advertising 421
ECAR Assessment 290
External Audits 214
Audinet (telephone) 211
Training 147
Computer 146
Miscellaneous 132
TOTAL PAYMENTS $580,852
</TABLE>
<PAGE>
11
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
SCHEDULE VI - FUEL STOCK EXPENSES UNDISTRIBUTED
INSTRUCTIONS: Report the amount of labor and expenses incurred with respect to
fuel stock expenses during the year and indicate amount attributable
to each associate company. Under the section headed "Summary" listed
below give an overall report of the fuel functions performed by the
service company.
_____________________________________________________________________________________
D E S C R I P T I O N LABOR EXPENSES TOTAL
(In Thousands)
ACCOUNT 152 - FUEL STOCK EXPENSES UNDISTRIBUTED
<S> <C> <C> <C>
Associate Companies
AEP Energy Services, Inc. $ 3 $ 2 $ 5
AEP Generating Company 8 6 14
Appalachian Power Company 861 545 1,406
Appalachian/Ohio Power Joint Account (Amos) 4 3 7
Appalachian/Ohio Power Joint Account (Sporn) 23 15 38
Blackhawk Coal Company 17 10 27
Cardinal Operating Company 207 138 345
Cedar Coal Co. 16 10 26
Central Appalachian Coal Company 1 1 2
Central Coal Company 4 2 6
Central Ohio Coal Company 766 532 1,298
Columbus Southern Power Company 482 312 794
Conesville Coal Preparation Company 243 158 401
Indiana Michigan Power Company 193 147 340
Indiana Michigan Power/AEP Generating Joint
Account (Rockport) 515 362 877
Indiana Michigan Power Company-Water Transportation 265 198 463
Kentucky Power Company 226 141 367
Kingsport Power Company 2 2 4
Ohio Power Company 1,140 793 1,933
Ohio Power Company-Cook Coal Terminal 239 160 399
Simco 6 3 9
Southern Appalachian Coal Company 3 2 5
Southern Ohio Coal Company 3,014 2,096 5,110
Wheeling Power Company 4 3 7
Windsor Coal Company 1,012 670 1,682
Statutory Subsidiaries
Indiana-Kentucky Electric Corporation 131 68 199
Ohio Valley Electric Corporation 123 63 186
TOTAL $9,508 $6,442 $15,950
</TABLE>
SUMMARY: Managerial, engineering, technical and administrative services
rendered to AEP System coal mining companies, and coal
procurement services rendered to AEP System generating companies
and other similar services.
<PAGE>
12
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
SCHEDULE VII - STORES EXPENSE UNDISTRIBUTED
INSTRUCTIONS: Report the amount of labor and expenses incurred with respect to
stores expense during the year and indicate amount attributable to
each associate company.
D E S C R I P T I O N LABOR EXPENSES TOTAL
(In Thousands)
<S> <C> <C> <C>
ACCOUNT 163 - STORES EXPENSE UNDISTRIBUTED
Associate Companies
AEP Energy Services $ -- $ 6 $ 6
AEP Generating Company 213 242 455
Appalachian Power Company 1,134 1,418 2,552
Appalachian/Ohio Power Joint Account (Amos) 2 71 73
Appalachian/Ohio Power Joint Account (Sporn) 2 47 49
Cardinal Operating Company 2 71 73
Cedar Coal Co. -- 5 5
Central Ohio Coal Company 3 97 100
Columbus Southern Power Company 612 702 1,314
Conesville Coal Preparation Company -- 9 9
Indiana Michigan Power Company 831 944 1,775
Indiana Michigan Power/AEP Generating
Joint Account (Rockport) 2 64 66
Indiana Michigan Power Company-Water Transportation 1 24 25
Kentucky Power Company 193 269 462
Kingsport Power Company 65 75 140
Ohio Power Company 1,089 1,490 2,579
Ohio Power Company-Cook Coal Terminal -- 12 12
Ohio Power Company (Gavin) 2 12 14
Southern Ohio Coal Company 4 142 146
Wheeling Power Company 48 73 121
Windsor Coal Company 2 58 60
Statutory Subsidiaries
Indiana-Kentucky Electric Corporation 1 4 5
TOTAL $4,206 $5,835 $10,041
</TABLE>
<PAGE>
13
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
SCHEDULE VIII
MISCELLANEOUS CURRENT AND ACCRUED ASSETS
INSTRUCTIONS: Provide detail of items in this account. Items less than
$10,000 may be grouped, showing the number of items in each
group.
BALANCE AT BALANCE AT
D E S C R I P T I O N BEGINNING CLOSE
OF YEAR OF YEAR
(In Thousands)
ACCOUNT 174 - MISCELLANEOUS CURRENT AND
ACCRUED ASSETS
Payroll Adjustments $ 4 $10
TOTAL $ 4 $10
<PAGE>
14
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
SCHEDULE IX - MISCELLANEOUS DEFERRED DEBITS
INSTRUCTIONS: Provide detail of items in this account. Items less than $10,000
may be grouped by class showing the number of items in each class.
BALANCE AT BALANCE AT
D E S C R I P T I O N BEGINNING CLOSE
OF YEAR OF YEAR
(In Thousands)
<S> <C> <C>
ACCOUNT 186 - MISCELLANEOUS DEFERRED DEBITS
Regulatory Asset-Postretirement Benefits $2,270 $1,945
Regulatory Asset-Postemployment Benefits 1,862 536
Regulatory Asset-Taxes 298 286
Unbilled Charges 2,223 3,467
Deferred Employee Moving Expenses 94 690
Miscellaneous - 2 items 1995; 0 items 1996 3 --
TOTAL $6,750 $6,924
</TABLE>
<PAGE>
15
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
SCHEDULE X
RESEARCH, DEVELOPMENT OR DEMONSTRATION EXPENDITURES
INSTRUCTIONS: Provide a description of each material research, development, or
demonstration project which incurred costs by the service corporation
during the year.
D E S C R I P T I O N AMOUNT
(In Thousands)
<S> <C>
ACCOUNT 188 - RESEARCH, DEVELOPMENT, OR DEMONSTRATION
EXPENDITURES
Transmission, Distribution & UHV Systems $166
Advanced Pressurized Water Reactor Design 128
Coal-Fired Generation 285
General Activities 56
Unpressurized Storage Water Heater 3
TOTAL $638
</TABLE>
<PAGE>
16
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
SCHEDULE XI - PROPRIETARY CAPITAL
NUMBER OF PAR OR STATED OUTSTANDING CLOSE OF PERIOD
ACCOUNT NUMBER CLASS OF STOCK SHARES VALUE
AUTHORIZED PER SHARE NO. OF SHARES TOTAL AMOUNT
<S> <S> <C> <C> <C> <C>
201 COMMON STOCK ISSUED 20,000 $100 13,500 $1,350,000
<CAPTION>
INSTRUCTIONS: Classify amounts in each account with brief explanation, disclosing the general
nature of transactions which gave rise to the reported amounts.
D E S C R I P T I O N AMOUNT
<S> <C>
ACCOUNT 211 - MISCELLANEOUS PAID-IN CAPITAL
None
ACCOUNT 215 - APPROPRIATED RETAINED EARNINGS
None
TOTAL $ -0-
<CAPTION>
INSTRUCTIONS: Give particulars concerning net income or (loss) during the year, distinguishing
between compensation for the use of capital owed or net loss remaining from servicing
nonassociates per the General Instructions of the Uniform System of
Accounts. For dividends paid during the year in cash or otherwise, provide rate
percentage, amount of dividend, date declared and date paid.
BALANCE AT NET INCOME BALANCE AT
D E S C R I P T I O N BEGINNING OR DIVIDENDS CLOSE
OF YEAR (LOSS) PAID OF YEAR
<S> <C> <C> <C> <C>
ACCOUNT 216 - UNAPPROPRIATED RETAINED EARNINGS
None
TOTAL $ -0- $ -0- $ -0- $ -0-
</TABLE>
<PAGE>
17
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
SCHEDULE XII - LONG-TERM DEBT
INSTRUCTIONS: Advances from associate companies should be reported separately for advances on notes,
and advances on open account. Names of associate companies from which advances were received
shall be shown under the class and series of obligation column. For Account 224 - Other long-
term debt provide the name of creditor company or organization, terms of the obligation, date
of maturity, interest rate, and the amount authorized and outstanding.
TERMS OF OBLIG DATE BALANCE AT ADDITIONS DEDUCTIONS BALANCE AT
N A M E O F CLASS & SERIES OF INTEREST AMOUNT BEGINNING 1/ CLOSE
C R E D I T O R OF OBLIGATION MATURITY RATE AUTHORIZED OF YEAR OF YEAR
(In Thousands)
<S> <C> <C> <C> <C> <C> <C> <C>
ACCOUNT 223 - ADVANCES
FROM ASSOCIATE COMPANIES:
Advance on Open Account
American Electric Power
Company, Inc. NONE $ 1,100 $ 1,100 $ -- $ -- $ 1,100
ACCOUNT 224 - OTHER LONG-
TERM DEBT:
PNC National Association,
Pittsburgh 10/14/98 5.293 10,000 10,000 -- -- 10,000
Connecticut Bank & Trust Company
(as Trustee),
--Series D Mortgage Notes 12/15/99 9.000 20,000 10,000 -- 2,500 7,500
--Series E Mortgage Notes 12/15/08 9.600 70,000 60,000 -- 2,500 57,500
Sub-Total 100,000 80,000 -- 5,000 75,000
TOTAL $101,100 $81,100 $ -- $ 5,000 $76,100
1/ GIVE AN EXPLANATION OF DEDUCTIONS: Loan payments. See Note 7, Schedule XIV, for further explanation of dates
of maturity.
</TABLE>
<PAGE>
18
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
SCHEDULE XIII - CURRENT AND ACCRUED LIABILITIES
INSTRUCTIONS: Provide balance of notes and accounts payable to each associate
company. Give description and amount of miscellaneous current
and accrued liabilities. Items less than $10,000 may be grouped,
showing the number of items in each group.
BALANCE AT BALANCE AT
D E S C R I P T I O N BEGINNING CLOSE
OF YEAR OF YEAR
(In Thousands)
<S> <C> <C>
ACCOUNT 233 - NOTES PAYABLE TO ASSOCIATE COMPANIES
None
TOTAL $ -0- $ -0-
(In Thousands)
ACCOUNT 234 - ACCOUNTS PAYABLE TO ASSOCIATE
COMPANIES
Indiana Michigan Power Company $12,724 $ 3,841
Indiana Michigan Power Company -
Water Transportation -- 44
Kentucky Power Company 3,838 3,841
Ohio Power Company 17,233 25,356
Miscellaneous - 10 items in 1995; 13 items in 1996 17 35
TOTAL $33,812 $30,132
(In Thousands)
ACCOUNT 242 - MISCELLANEOUS CURRENT AND
ACCRUED LIABILITIES
Accrued Vacation Pay $ 8,501 $14,326
Accrued Incentive Pay 6,129 6,950
Accrued Severance Pay 495 --
Employee Savings Plan 16 --
Accrued Workers' Compensation 278 327
AEP System Stock Purchase Plan 102 88
Payroll Withholdings 166 250
Accrued Rent on John E. Dolan Engineering Laboratory 1,231 1,187
Accrued Rent for Office Space at Market Square,
Washington, D.C. 91 85
Accrued Rent on the IBM 3090 System 1 --
Accrued Severance-Group Medical 159 191
TOTAL $17,169 $23,404
</TABLE>
<PAGE>
19
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
SCHEDULE XIV
NOTES TO FINANCIAL STATEMENTS
INSTRUCTIONS: The space below is provided for important notes
regarding the financial statements or any account
thereof. Furnish particulars as to any significant
contingent assets or liabilities existing at the
end of the year. Notes relating to financial
statements shown elsewhere in this report may be
indicated here by reference.
1. SIGNIFICANT ACCOUNTING POLICIES:
Organization
American Electric Power Service Corporation (the Company
or AEPSC) is a wholly-owned subsidiary of American Electric
Power Company, Inc. (AEP Co., Inc.), a public utility holding
company. The Company provides certain managerial and profess-
ional services including administrative and engineering ser-
vices to the affiliated companies in the American Electric
Power (AEP) System and periodically to unaffiliated companies.
Regulation and Basis of Accounting
As a subsidiary of AEP Co., Inc., AEPSC is subject to
regulation by the Securities and Exchange Commission (SEC)
under the Public Utility Holding Company Act of 1935 (1935
Act).
The Company's accounting conforms to the Uniform System of
Accounts for Mutual and Subsidiary Service Companies
prescribed by the SEC pursuant to the 1935 Act. As a cost-
based rate-regulated entity, AEPSC's financial statements
reflect the actions of the regulators that result in the
recognition of revenues and expenses in different time periods
than enterprises that are not rate regulated. In accordance
with Statement of Financial Accounting Standards (SFAS) No.
71, Accounting for the Effects of Certain Types of Regulation
(SFAS 71), the financial statements include assets (deferred
expenses) and liabilities (deferred income) recorded in
accordance with regulatory actions to match expenses and
revenues in cost-based rates. Regulatory assets are expected
to be recovered in future periods through billings to affil-
iated companies and the regulatory liabilities are expected
to reduce future billings. The Company has reviewed all the
evidence currently available and concluded that it continues
to meet the requirements to apply SFAS 71. Among other things
application of SFAS 71 requires that the Company s billing
rates be cost-based regulated. In the event a portion of
the Company s business were to no longer meet those require-
(Cont'd)
<PAGE>
19A
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
SCHEDULE XIV
NOTES TO FINANCIAL STATEMENTS
INSTRUCTIONS: The space below is provided for important notes
regarding the financial statements or any account
thereof. Furnish particulars as to any significant
contingent assets or liabilities existing at the
end of the year. Notes relating to financial
statements shown elsewhere in this report may be
indicated here by reference.
ments, net regulatory assets would have to be written off for
that portion of the business and assets would have to be tested
for possible impairment.
Regulatory assets and liabilities are comprised of the
following:
December 31,
1996 1995
Regulatory Assets: (In Thousands)
Unamortized Loss on Reacquired
Debt $5,772 $ 6,439
Postretirement Benefits 1,945 2,270
Postemployment Benefits 536 1,862
Total Regulatory Assets $8,253 $10,571
Regulatory Liabilities:
Deferred Amounts Due to
Affiliates for Income
Tax Benefits (Net) $7,317 $7,443
Deferred Investment Tax Credits 1,105 1,152
Total Regulatory Liabilities $8,422 $8,595
Use of Estimates
The preparation of these financial statements in conformity
with generally accepted accounting principles requires in
certain instances the use of management's estimates. Actual
results could differ from those estimates.
Income and Expenses
Services rendered to both affiliated and unaffiliated com-
panies are provided at cost. The charges for services include
no compensation for the use of equity capital, all of which is
furnished by AEP Co., Inc. The costs of the services are
determined on a direct charge basis to the extent practicable
and on reasonable bases of proration for indirect costs.
(Cont'd)
<PAGE>
19B
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
SCHEDULE XIV
NOTES TO FINANCIAL STATEMENTS
INSTRUCTIONS: The space below is provided for important notes
regarding the financial statements or any account
thereof. Furnish particulars as to any significant
contingent assets or liabilities existing at the
end of the year. Notes relating to financial
statements shown elsewhere in this report may be
indicated here by reference.
Income Taxes
The Company follows the liability method of accounting for
income taxes as prescribed by SFAS 109, Accounting for Income
Taxes. Under the liability method, deferred income taxes are
provided for all temporary differences between book cost and
tax basis of assets and liabilities which will result in a
future tax consequence. Where the flow-through method of
accounting for temporary differences is reflected in billings,
regulatory assets and liabilities are recorded in accordance
with SFAS 71.
Investment Tax Credits
Investment tax credits utilized in prior years' federal
income tax returns were deferred and are being amortized
over the life of the related investment in accordance with
regulatory treatment.
Property
Property is stated at original cost. Land, structures and
structural improvements are generally subject to first
mortgage liens. Depreciation is provided on a straight-
line basis over the estimated useful lives of the property.
Investments
Investments include the cash surrender value of corporate
owned life insurance policies net of policy loans and interest
accrued on the loans.
Debt
With SEC Staff approval gains and losses on reacquired debt
are deferred and amortized over the term of the replacement
debt.
Debt issuance expenses are amortized over the term of the
related debt, with the amortization included in interest
charges.
(Cont'd)
<PAGE>
19C
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
SCHEDULE XIV
NOTES TO FINANCIAL STATEMENTS
INSTRUCTIONS: The space below is provided for important notes
regarding the financial statements or any account
thereof. Furnish particulars as to any significant
contingent assets or liabilities existing at the
end of the year. Notes relating to financial
statements shown elsewhere in this report may be
indicated here by reference.
Reclassifications
Certain prior-period amounts were reclassified to conform
with current-period presentation.
2. COMMITMENTS AND CONTINGENCIES:
The Company is involved in a number of legal proceedings
and claims. While management is unable to predict the outcome
of litigation, any potential liability which may result
therefrom would be recoverable from its affiliated companies.
3. BENEFIT PLANS:
AEPSC participates in the AEP System pension plan, a
trusteed, noncontributory defined benefit plan covering all
employees meeting eligibility requirements. Benefits are
based on service years and compensation levels. Pension
costs are allocated by first charging each System company
with its service cost and then allocating the remaining
pension cost in proportion to its share of the projected
benefit obligation. The funding policy is to make annual
trust fund contributions equal to the net periodic pension
cost up to the maximum amount deductible for federal income
taxes, but not less than the minimum required contribution
in accordance with the Employee Retirement Income Security
Act of 1974.
Net pension plan costs for the years ended December 31,
1996 and 1995 were $3.7 million and $2.6 million,
respectively.
An employee savings plan is offered which allows partici-
pants to contribute up to 17% of their salaries into various
investment alternatives, including AEP Co., Inc. common stock.
An employer matching contribution, equaling one-half of the
employees' contribution to the plan up to a maximum of 3% of
the employees' base salary, is invested in AEP Co., Inc.
common stock. The Company's annual contribution totaled $4.3
million in 1996 and $2.9 million in 1995.
(Cont'd)
<PAGE>
19D
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
SCHEDULE XIV
NOTES TO FINANCIAL STATEMENTS
INSTRUCTIONS: The space below is provided for important notes
regarding the financial statements or any account
thereof. Furnish particulars as to any significant
contingent assets or liabilities existing at the
end of the year. Notes relating to financial
statements shown elsewhere in this report may be
indicated here by reference.
Postretirement benefits other than pensions (OPEB) are
provided for retired employees under an AEP System plan.
Substantially all employees are eligible for health care and
life insurance if they retire from active service after reach-
ing age 55 and have at least 10 service years. OPEB costs are
determined by the application of AEP System actuarial assump-
tions to each company s employee complement. The annual
accrued costs, which includes the recognition of one-twentieth
of the prior service transition obligation, were $6.9 million
in 1996, $7.3 million in 1995. The funding policy for AEP s
OPEB plan is to make contributions to an external Voluntary
Employees Beneficiary Association trust fund equal to the
incremental OPEB costs (i.e., the amount that the total post-
retirement benefits cost under SFAS 106, Employers' Accounting
for Postretirement Benefits Other Than Pensions, exceeds the
pay-as-you-go amount). Contributions were $4.0 million in
1996 and $4.5 million in 1995.
4. FAIR VALUE OF FINANCIAL INSTRUMENTS:
The carrying amount of cash and cash equivalents, special
deposits - restricted funds, accounts receivable and accounts
payable approximates fair value because of the short-term
maturities of these instruments. At December 31, 1996 and
1995 the fair value of long-term debt was $91 million and
$103 million, respectively, based on quoted market prices for
similar issues and current interest rates offered for debt of
the same remaining maturities. The carrying amount for long-
term debt was $76 million and $81 million at December 31, 1996
and 1995, respectively.
(Cont'd)
<PAGE>
19E
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
SCHEDULE XIV
NOTES TO FINANCIAL STATEMENTS
INSTRUCTIONS: The space below is provided for important notes
regarding the financial statements or any account
thereof. Furnish particulars as to any significant
contingent assets or liabilities existing at the
end of the year. Notes relating to financial
statements shown elsewhere in this report may be
indicated here by reference.
5. FEDERAL INCOME TAXES:
The details of federal income taxes as reported are as
follows:
Year Ended December 31,
1996 1995
(In Thousands)
Current (net)................... $ 7,192 $(4,209)
Deferred (net).................. (10,615) (930)
Deferred Investment Tax Credits
(net)........................ (47) (207)
Total Federal Income Tax
Credit..................... $ (3,470) $(5,346)
Federal income taxes as reported are different than the pre-
tax book loss multiplied by the statutory federal income tax
rate predominantly due to non-taxable income related to
corporate owned life insurance and amortization of deferred
investment tax credits.
The following tables show the elements of the net deferred
tax asset or liability and the significant temporary differ-
ences giving rise to such deferrals:
December 31,
1996 1995
(In Thousands)
Deferred Tax Assets $ 31,287 $ 20,420
Deferred Tax Liabilities (27,455) (27,077)
Net Deferred Tax Asset (Liabilities) $ (3,832) $ (6,657)
Property Related Temporary Differences $(25,673) $(25,141)
Accrued Pension Expense 12,704 7,074
Accrued Vacation Pay 5,084 2,708
Deferred and Accrued Compensation 5,751 4,421
Amounts Due to Affiliates for
Future Income Tax 2,561 2,608
All Other (net) 3,405 1,673
Total Net Deferred Tax
Asset (Liabilities) $ 3,832 $( 6,657)
(Cont'd)
<PAGE>
19F
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
SCHEDULE XIV
NOTES TO FINANCIAL STATEMENTS
INSTRUCTIONS: The space below is provided for important notes
regarding the financial statements or any account
thereof. Furnish particulars as to any significant
contingent assets or liabilities existing at the
end of the year. Notes relating to financial
statements shown elsewhere in this report may be
indicated here by reference.
The Company joins in the filing of a consolidated federal
income tax return with its affiliates in the AEP System. The
allocation of the AEP System's current consolidated federal
income tax to the System companies is in accordance with SEC
rules under the 1935 Act. These rules permit the allocation
of the benefit of current tax losses utilized to the System
companies giving rise to them in determining their current
tax expense. The tax loss of the System parent company, AEP
Co., Inc., is allocated to its subsidiaries with taxable
income. With the exception of the loss of the parent company,
the method of allocation approximates a separate return result
for each company in the consolidated group.
6. LEASES:
Leases of structures, improvements, office furniture and
miscellaneous equipment are for periods of up to 30 years and
require payments of related property taxes, maintenance and
operating costs. The majority of the leases have purchase or
renewal options and will be renewed or replaced by other
leases.
The components of rental costs are as follows:
Year Ended December 31,
1996 1995
(In Thousands)
Operating Leases.................$ 6,033 $ 3,293
Amortization of Capital Leases... 13,755 11,479
Interest on Capital Leases....... 2,966 2,452
Total Rental Costs...........$22,754 $17,224
(Cont'd)
<PAGE>
19G
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
SCHEDULE XIV
NOTES TO FINANCIAL STATEMENTS
INSTRUCTIONS: The space below is provided for important notes
regarding the financial statements or any account
thereof. Furnish particulars as to any significant
contingent assets or liabilities existing at the
end of the year. Notes relating to financial
statements shown elsewhere in this report may be
indicated here by reference.
Properties under capital leases and related obligations
recorded on the Balance Sheets are as follows:
December 31,
1996 1995
(In Thousands)
Properties Under Capital Leases:
Structures and Improvements...... $11,750 $11,750
Office Furniture and Miscellaneous
Equipment...................... 64,086 48,083
75,836 59,833
Accumulated Amortization........... 32,565 23,058
Net Properties Under Capital
Leases......................... $43,271 $36,775
Capital Lease Obligations:
Noncurrent Liability............. $32,670 $24,660
Liability Due Within One Year.... 10,601 12,115
Total Capital Lease Obligations $43,271 $36,775
Properties under operating leases and related obligations
are not included in the Balance Sheets.
Future minimum lease rentals consisted of the following at
December 31, 1996:
Noncancelable
Capital Operating
Leases Leases
(In Thousands)
1997............................. $13,424 $ 535
1998............................. 9,649 401
1999............................. 7,937 353
2000............................. 5,732 120
2001............................. 3,289 130
Later Years...................... 22,531 259
Total Future Minimum Lease
Rentals........................ 62,562 $1,798
Less Estimated Interest Element.. 19,291
Estimated Present Value of Future
Minimum Lease Rentals.......... $43,271
(Cont'd)
<PAGE> 19H
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
SCHEDULE XIV
NOTES TO FINANCIAL STATEMENTS
INSTRUCTIONS: The space below is provided for important notes
regarding the financial statements or any account
thereof. Furnish particulars as to any significant
contingent assets or liabilities existing at the
end of the year. Notes relating to financial
statements shown elsewhere in this report may be
indicated here by reference.
7. LONG-TERM DEBT:
Long-term debt was outstanding as follows:
December 31,
Interest 1996 1995
Rate (In Thousands)
Notes Payable to Banks:
Due October 1998.......... 5.29% $10,000 $10,000
Mortgage Notes:
Series D(a)............... 9.00% 7,500 10,000
Series E(b)............... 9.60% 57,500 60,000
Advances from Parent Company. (c) 1,100 1,100
76,100 81,100
Less Portion Due Within One Year 5,000 5,000
Total...................... $71,100 $76,100
(a) Due in annual installments of $2,500,000 until
December 1999.
(b) Due in annual installments of $2,500,000 until
December 1999, $2,000,000 from 2000-2007 and the
balance in December 2008.
(c) The advances from parent company are non-interest
bearing and have no due date.
Long-term debt outstanding at December 31, 1996 is payable
as follows:
Principal
Amount
(In Thousands)
1997...................................... 5,000
1998...................................... 15,000
1999...................................... 5,000
2000...................................... 2,000
2001...................................... 2,000
Later Years............................... 47,100
Total................................... $76,100
<PAGE>
20
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
SCHEDULE XV
STATEMENT OF INCOME
ACCOUNT D E S C R I P T I O N CURRENT YEAR PRIOR YEAR
(In Thousands)
<S> <C> <C>
INCOME
457 Services rendered to associate companies $393,743 $260,442
458 Services rendered to nonassociate
companies 501 63
421 Miscellaneous income or loss 321 381
Total Income 394,565 260,886
EXPENSE
920 Salaries and wages 199,116 125,066
921 Office supplies and expenses 27,721 15,646
922 Administrative expense transferred - credit (889) (770)
923 Outside services employed 61,486 46,704
924 Property insurance 104 91
925 Injuries and damages 1,673 659
926 Employee pensions and benefits 49,869 28,818
928 Regulatory commission expense -- --
930.1 General advertising expenses -- --
930.2 Miscellaneous general expenses 1,287 883
931 Rents 23,536 18,845
932 Maintenance of structures and equipment 4,609 3,242
403 Depreciation and amortization expense 4,008 4,009
408 Taxes other than income taxes 14,757 12,161
409 Income taxes 7,312 (4,209)
410 Provision for deferred income taxes 10,746 8,969
411 Provision for deferred income taxes - credit (21,361) (9,899)
411.5 Investment tax credit (47) (207)
426.1 Donations 1,288 1,271
426.5 Other deductions 1,452 1,301
427 Interest on long-term debt 7,198 7,631
430 Interest on debt to associate companies -- --
431 Other interest expense 700 675
Total Expense 394,565 260,886
Net Income or (Loss) $ -0- $ -0-
</TABLE>
<PAGE>
21
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION> ANALYSIS OF BILLING
ASSOCIATE COMPANIES
ACCOUNT 457
DIRECT INDIRECT COMPENSATION TOTAL
NAME OF ASSOCIATE COMPANY COSTS COSTS FOR USE OF AMOUNT
CHARGED CHARGED CAPITAL BILLED
457-1 457-2 457-3
(In Thousands)
<S> <C> <C> <C> <C>
Associate Companies
AEP Communications, Inc. $ 191 $ 20 $-- $ 211
AEP Energy Services, Inc. 3,062 459 6 3,527
AEP Energy Solutions, Inc. 931 24 -- 955
AEP Generating Company 3,355 432 8 3,795
AEP Investments, Inc. 12 2 -- 14
AEP Pushan Power, LDC 29 8 -- 37
AEP Resources, Inc. 1,364 164 -- 1,528
AEP Resources International, Limited 1,434 129 -- 1,563
American Electric Power Company, Inc. 2,012 263 2 2,277
Appalachian Power Company 74,461 10,597 116 85,174
Appalachian Power (Commercial PFBC) 9 2 -- 11
Appalachian/Ohio Power Joint
Account (Amos) 5,896 742 2 6,640
Appalachian/Ohio Power Joint
Account (Sporn) 4,345 704 1 5,050
Blackhawk Coal Company/Price River Coal
Company 25 4 -- 29
Cardinal Operating Company 9,478 1,262 3 10,743
Cedar Coal Co. 37 6 -- 43
Central Appalachian Coal Company 2 -- -- 2
Central Coal Company 5 1 -- 6
Central Ohio Coal Company 1,310 228 4 1,542
Central Operating Company 167 23 1 191
Columbus Southern Power Company 41,365 5,781 64 47,210
Conesville Coal Preparation Company 361 69 1 431
Indiana Michigan Power Company 73,739 9,223 138 83,100
Indiana Michigan Power Company-
Water Transportation 597 100 2 699
Indiana Michigan Power/AEP Generating
Joint Account (Rockport) 5,962 904 6 6,872
Kentucky Power Company 21,734 3,184 22 24,940
Kingsport Power Company 2,259 308 4 2,571
Ohio Power Company 78,561 10,538 109 89,208
Ohio Power Company-Cook Coal Terminal 394 69 2 465
Ohio Power Company (Gavin) 2,125 436 5 2,566
Simco, Inc. 8 2 -- 10
Southern Appalachian Coal Company 3 1 -- 4
Southern Ohio Coal Company 5,041 919 13 5,973
Wheeling Power Company 2,304 266 4 2,574
Windsor Coal Company 1,583 300 3 1,886
Unbilled Revenues (4) (2) -- (6)
SUB-TOTAL 344,157 47,168 516 391,841
(Cont'd)
</TABLE>
<PAGE>
21A
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
ANALYSIS OF BILLING
ASSOCIATE COMPANIES
ACCOUNT 457
DIRECT INDIRECT COMPENSATION TOTAL
NAME OF ASSOCIATE COMPANY COSTS COSTS FOR USE OF AMOUNT
CHARGED CHARGED CAPITAL BILLED
457-1 457-2 457-3
(In Thousands)
<S> <C> <C> <C> <C>
Sub-Total Brought Forward 344,157 47,168 516 391,841
Statutory Subsidiaries
Indiana-Kentucky Electric Corporation 851 170 3 1,024
Ohio Valley Electric Corporation 730 146 2 878
TOTAL $345,738 $47,484 $521 $393,743
</TABLE>
<PAGE>
22
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
ANALYSIS OF BILLING
NONASSOCIATE COMPANIES
ACCOUNT 458
DIRECT INDIRECT COMPENSATION EXCESS TOTAL
NAME OF NONASSOCIATE COMPANY COST COST FOR USE TOTAL OR AMOUNT
CHARGED CHARGED CAPITAL COST DEFICIENCY BILLED
458-1 458-2 458-3 458-4
(In Thousands)
<S> <C> <C> <C> <C> <C> <C>
ABB Systems Control, Inc. $299 $111 $-- $410 $-- $410
East Central Area Reliability 41 -- -- 41 -- 41
American Municipal Power-Ohio, Inc. 13 2 -- 15 -- 15
City of Dover 8 2 -- 10 -- 10
Ormet Aluminum Company 5 1 -- 6 -- 6
Ohio Edison Company 3 -- -- 3 -- 3
Duke Power Company 2 -- -- 2 -- 2
Mid-Atlantic Area Coordination 2 -- -- 2 -- 2
Allegheny Power Company 1 -- -- 1 -- 1
PJM Interconnections 1 -- -- 1 -- 1
Centerior Energy 1 -- -- 1 -- 1
Cinergy Corporation 1 -- -- 1 -- 1
Dayton Power and Light Company 1 -- -- 1 -- 1
Louisville Gas & Electric Company 1 -- -- 1 -- 1
New England Power Exchange 1 -- -- 1 -- 1
New York Power Company 1 -- -- 1 -- 1
Northwest Power Coordinating Council 1 -- -- 1 -- 1
Ontario Hydro 1 -- -- 1 -- 1
Virginia Electric Power Company 1 -- -- 1 -- 1
West Penn Power Company 1 -- -- 1 -- 1
TOTAL $385 $116 $-0- $501 $-0- $501
INSTRUCTION: Provide a brief description of the services rendered to each nonassociate company:
Engineering and computer services.
</TABLE>
<PAGE>
23
<TABLE> ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION> SCHEDULE XVI
ANALYSIS OF CHARGES FOR SERVICE
ASSOCIATE AND NONASSOCIATE COMPANIES
ASSOCIATE COMPANY CHARGES NONASSOCIATE COMPANY CHARGES
DESCRIPTION OF ITEMS DIRECT INDIRECT DIRECT INDIRECT
COST COST TOTAL COST COST TOTAL
(In Thousands)
<S> <C> <C> <C> <C> <C> <C>
920 SALARIES AND WAGES $194,187 $ 4,658 $198,845 $260 $ 11 $271
921 OFFICE SUPPLIES AND EXPENSES 15,206 12,478 27,684 4 33 37
922 ADMINISTRATIVE EXPENSE TRANSFERRED-CREDIT (889) -- (889) -- -- --
923 OUTSIDE SERVICES EMPLOYED 57,013 4,449 61,462 13 11 24
924 PROPERTY INSURANCE -- 104 104 -- -- --
925 INJURIES AND DAMAGES 1,655 16 1,671 2 -- 2
926 EMPLOYEE PENSIONS AND BENEFITS 45,601 4,198 49,799 60 10 70
928 REGULATORY COMMISSION EXPENSE -- -- -- -- -- --
930.1 GENERAL ADVERTISING EXPENSES -- -- -- -- -- --
930.2 MISCELLANEOUS GENERAL EXPENSES 1,183 87 1,270 -- 17 17
931 RENTS 16,398 7,138 23,536 -- -- --
932 MAINTENANCE OF STRUCTURES AND EQUIPMENT 2,650 1,929 4,579 25 5 30
403 DEPRECIATION AND AMORTIZATION EXPENSE 159 3,837 3,996 3 9 12
408 TAXES OTHER THAN INCOME TAXES 13,135 1,600 14,735 18 4 22
409 INCOME TAXES 7,072 240 7,312 -- -- --
410 PROVISION FOR DEFERRED INCOME TAXES 10,746 -- 10,746 -- -- --
411 PROVISION FOR DEFERRED INCOME TAXES-CREDIT (21,361) -- (21,361) -- -- --
411.5 INVESTMENT TAX CREDIT (47) -- (47) -- -- --
426.1 DONATIONS 1,288 -- 1,288 -- -- --
426.5 OTHER DEDUCTIONS 1,452 -- 1,452 -- -- --
427 INTEREST ON LONG-TERM DEBT 807 6,375 7,182 -- 16 16
431 OTHER INTEREST EXPENSE 33 667 700 -- -- --
INSTRUCTION: Total cost of service will equal for
associate and nonassociate companies the total
amount billed under their separate analysis of
billing schedules.
TOTAL EXPENSES = 346,288 47,776 394,064 385 116 501
421 MISCELLANEOUS INCOME (29) (292) (321) -- -- --
TOTAL EXPENSES = $346,259 $47,484 $393,743 $385 $116 $501
COMPENSATION FOR USE OF EQUITY CAPITAL = -- -- -- -- -- --
430 INTEREST ON DEBT TO ASSOCIATE COMPANIES= -- -- -- -- -- --
TOTAL COST OF SERVICE = $346,259 $47,484 $393,743 $385 $116 $501
(Cont'd)
</TABLE>
<PAGE>
23A
<TABLE> ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION> SCHEDULE XVI
ANALYSIS OF CHARGES FOR SERVICE
ASSOCIATE AND NONASSOCIATE COMPANIES
TOTAL CHARGES FOR SERVICE
DESCRIPTION OF ITEMS DIRECT INDIRECT
COST COST TOTAL
(In Thousands)
<S> <C> <C> <C>
920 SALARIES AND WAGES $194,447 $ 4,669 $199,116
921 OFFICE SUPPLIES AND EXPENSES 15,210 12,511 27,721
922 ADMINISTRATIVE EXPENSE TRANSFERRED-CREDIT (889) -- (889)
923 OUTSIDE SERVICES EMPLOYED 57,027 4,459 61,486
924 PROPERTY INSURANCE -- 104 104
925 INJURIES AND DAMAGES 1,657 16 1,673
926 EMPLOYEE PENSIONS AND BENEFITS 45,661 4,208 49,869
928 REGULATORY COMMISSION EXPENSE -- -- --
930.1 GENERAL ADVERTISING EXPENSES -- -- --
930.2 MISCELLANEOUS GENERAL EXPENSES 1,200 87 1,287
931 RENTS 16,380 7,156 23,536
932 MAINTENANCE OF STRUCTURES AND EQUIPMENT 2,675 1,934 4,609
403 DEPRECIATION AND AMORTIZATION EXPENSE 162 3,846 4,008
408 TAXES OTHER THAN INCOME TAXES 13,153 1,604 14,757
409 INCOME TAXES 7,072 240 7,312
410 PROVISION FOR DEFERRED INCOME TAXES 10,746 -- 10,746
411 PROVISION FOR DEFERRED INCOME TAXES-CREDIT (21,361) -- (21,361)
411.5 INVESTMENT TAX CREDIT (47) -- (47)
426.1 DONATIONS 1,288 -- 1,288
426.5 OTHER DEDUCTIONS 1,452 -- 1,452
427 INTEREST ON LONG-TERM DEBT 807 6,391 7,198
431 OTHER INTEREST EXPENSE 33 667 700
INSTRUCTION: Total cost of service will equal for
associate and nonassociate companies the total
amount billed under their separate analysis of
billing schedules.
TOTAL EXPENSES = 346,673 47,892 394,565
421 MISCELLANEOUS INCOME (29) (292) (321)
TOTAL EXPENSES = $346,644 $47,600 $394,244
COMPENSATION FOR USE OF EQUITY CAPITAL = -- -- --
430 INTEREST ON DEBT TO ASSOCIATE COMPANIES= -- -- --
TOTAL COST OF SERVICE = $346,644 $47,600 $394,244
</TABLE>
<PAGE>
24
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION> SCHEDULE XVII
SCHEDULE OF EXPENSE DISTRIBUTION
BY
DEPARTMENT OR SERVICE FUNCTION
CORPORATE CORPORATE
D E S C R I P T I O N O F I T E M S TOTAL ACCOUNTING CORPORATE COMMUNI- PLANNING &
AMOUNT OVERHEAD SERVICES ACCOUNTING CATIONS BUDGETING
(In Thousands)
<S> <C> <C> <C> <C> <C> <C>
920 SALARIES AND WAGES $199,116 $ 4,869 $ 86 $3,229 $3,267 $2,276
921 OFFICE SUPPLIES AND EXPENSES 27,721 8,299 -- 154 827 83
922 ADMINISTRATIVE EXPENSE TRANSFERRED -
CREDIT (889) -- -- (5) (176) --
923 OUTSIDE SERVICES EMPLOYED 61,486 2,873 -- 56 229 1,010
924 PROPERTY INSURANCE 104 104 -- -- -- --
925 INJURIES AND DAMAGES 1,673 31 1 26 22 13
926 EMPLOYEE PENSIONS AND BENEFITS 49,869 4,644 59 693 836 483
928 REGULATORY COMMISSION EXPENSE -- -- -- -- -- --
930.1 GENERAL ADVERTISING EXPENSES -- -- -- -- -- --
930.2 MISCELLANEOUS GENERAL EXPENSES 1,287 70 -- -- 81 3
931 RENTS 23,536 1,356 -- 61 91 53
932 MAINTENANCE OF STRUCTURES AND EQUIPMENT 4,609 1,946 -- -- 12 (31)
403 DEPRECIATION AND AMORTIZATION EXPENSE 4,008 4,008 -- -- -- --
408 TAXES OTHER THAN INCOME TAXES 14,757 1,799 14 218 209 130
409 INCOME TAXES 7,312 120 -- -- -- --
410 PROVISION FOR DEFERRED INCOME TAXES 10,746 -- -- -- -- --
411 PROVISION FOR DEFERRED INCOME TAXES -
CREDIT (21,361) -- -- -- -- --
411.5 INVESTMENT TAX CREDIT (47) -- -- -- -- --
426.1 DONATIONS 1,288 -- -- -- 10 --
426.5 OTHER DEDUCTIONS 1,452 3 -- 5 182 --
427 INTEREST ON LONG-TERM DEBT 7,198 6,660 -- -- -- --
430 INTEREST ON DEBT TO ASSOCIATE COMPANIES -- -- -- -- -- --
431 OTHER INTEREST EXPENSE 700 700 -- -- -- --
INSTRUCTION: Indicate each department or
service function. (see Instruction 01-3
General Structure of Accounting System:
Uniform System of Accounts)
TOTAL EXPENSES = $394,565 $37,482 $160 $4,437 $5,590 $4,020
</TABLE>
<PAGE>
25
<TABLE> ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION> SCHEDULE XVII
SCHEDULE OF EXPENSE DISTRIBUTION
BY
DEPARTMENT OR SERVICE FUNCTION
D E P A R T M E N T O R S E R V I C E F U N C T I O N
ENERGY ENERGY ENERGY ENVIRON- FOSSIL & FUEL SUPPLY
ACCOUNT CORPORATE DELIVERY DISTRI- TRANS- MENTAL EXECUTIVE HYDRO & BUSINESS HUMAN
NUMBER SERVICES SUPPORT BUTION MISSION SERVICES GROUP FINANCE PRODUCTION SUPPORT RESOURCES
(In Thousands)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
920 $ 995 $10,912 $6,089 $11,792 $4,374 $ 8,913 $1,135 $ 6,811 $6,277 $10,156
921 31 1,001 519 355 359 1,477 109 478 398 1,183
922 -- (2) -- (1) (5) (647) -- (1) (30) --
923 43 599 369 783 174 3,649 251 1,188 227 1,403
924 -- -- -- -- -- -- -- -- -- --
925 3 93 42 111 31 48 7 48 37 94
926 236 2,272 1,323 2,511 1,009 2,030 226 1,445 1,231 3,818
928 -- -- -- -- -- -- -- -- -- --
930.1 -- -- -- -- -- -- -- -- -- --
930.2 -- 48 -- 1 7 700 73 4 36 56
931 5 1,174 390 274 166 145 113 70 75 705
932 -- 363 -- 6 78 -- -- 17 2 5
403 -- -- -- -- -- -- -- -- -- --
408 69 698 406 789 303 425 68 427 373 711
409 -- -- -- -- -- -- -- -- -- --
410 -- -- -- -- -- -- -- -- -- --
411 -- -- -- -- -- -- -- -- -- --
411.5 -- -- -- -- -- -- -- -- -- --
426.1 -- 102 -- -- 5 1,022 -- -- 44 83
426.5 -- -- -- 1 -- 1,214 -- 1 40 --
427 -- -- -- -- -- -- 538 -- -- --
430 -- -- -- -- -- -- -- -- -- --
431 -- -- -- -- -- -- -- -- -- --
$1,382 $17,260 $9,138 $16,622 $6,501 $18,976 $2,520 $10,488 $8,710 $18,214
(Cont'd)
</TABLE>
<PAGE>
25A
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION> SCHEDULE XVII
SCHEDULE OF EXPENSE DISTRIBUTION
BY
DEPARTMENT OR SERVICE FUNCTION
D E P A R T M E N T O R S E R V I C E F U N C T I O N
INFOR- NORTHERN NORTHERN POWER PROCUREMENT
ACCOUNT MATION INTERNAL MARKETING RSO RSO NUCLEAR GENERATION & SUPPLY
NUMBER SERVICES AUDITS LEGAL SERVICES PRODUCTION SUPPORT GENERATION ENGINEERING CHAIN RATES
(In Thousands)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
920 $16,946 $3,181 $3,827 $ 4,675 $13,300 $ 6,307 $16,626 $20,489 $4,317 $2,029
921 1,224 221 253 1,012 2,632 1,021 694 1,269 136 73
922 -- -- -- (20) -- -- -- -- -- (1)
923 32,449 331 98 5,300 99 544 3,562 879 2,323 152
924 -- -- -- -- -- -- -- -- -- --
925 126 21 21 34 129 49 78 142 32 12
926 3,753 697 799 1,024 2,537 1,789 5,044 4,474 960 415
928 -- -- -- -- -- -- -- -- -- --
930.1 -- -- -- -- -- -- -- -- -- --
930.2 10 -- 6 110 7 5 8 52 1 --
931 16,121 16 255 287 138 41 230 599 95 23
932 1,859 -- -- 1 58 3 30 160 -- --
403 -- -- -- -- -- -- -- -- -- --
408 1,193 219 191 306 996 447 1,149 1,378 308 121
409 -- -- -- -- -- -- -- -- -- --
410 -- -- -- -- -- -- -- -- -- --
411 -- -- -- -- -- -- -- -- -- --
411.5 -- -- -- -- -- -- -- -- -- --
426.1 -- -- -- 20 -- -- -- -- -- 1
426.5 -- -- 1 1 -- 1 2 -- -- --
427 -- -- -- -- -- -- -- -- -- --
430 -- -- -- -- -- -- -- -- -- --
431 -- -- -- -- -- -- -- -- -- --
$73,681 $4,686 $5,451 $12,750 $19,896 $10,207 $27,423 $29,442 $8,172 $2,825
RSO = Regional Service Organization
(Cont d)
</TABLE>
<PAGE>
25B
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION> SCHEDULE XVII
SCHEDULE OF EXPENSE DISTRIBUTION
BY
DEPARTMENT OR SERVICE FUNCTION
D E P A R T M E N T O R S E R V I C E F U N C T I O N
SOUTHERN SOUTHERN SYSTEM
ACCOUNT RSO RSO SYSTEM POWER
NUMBER PRODUCTION SUPPORT PLANNING MARKETS TAX
(In Thousands)
<S> <C> <C> <C> <C> <C>
920 $12,080 $3,384 $5,903 $3,746 $ 1,125
921 1,655 1,760 205 223 70
922 -- -- (1) -- --
923 60 384 270 1,858 323
924 -- -- -- -- --
925 255 87 49 24 7
926 2,387 857 1,243 829 245
928 -- -- -- -- --
930.1 -- -- -- -- --
930.2 -- 4 -- 4 1
931 16 298 219 519 1
932 11 54 1 34 --
403 -- -- -- -- --
408 914 248 347 227 74
409 -- -- -- -- 7,192
410 -- -- -- -- 10,746
411 -- -- -- -- (21,361)
411.5 -- -- -- -- (47)
426.1 -- -- 1 -- --
426.5 -- 1 -- -- --
427 -- -- -- -- --
430 -- -- -- -- --
431 -- -- -- -- --
$17,378 $7,077 $8,237 $7,464 $( 1,624)
RSO = Regional Service Organization
</TABLE>
<PAGE>
26
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
DEPARTMENTAL ANALYSIS OF SALARIES
ACCOUNT 920
DEPARTMENTAL SALARY EXPENSE NUMBER
NAME OF DEPARTMENT INCLUDED IN AMOUNTS BILLED TO PERSONNEL
Indicate each department or TOTAL PARENT OTHER NON END OF
service function. AMOUNT COMPANY ASSOCIATES ASSOCIATES YEAR
(In Thousands)
<S> <C> <C> <C> <C> <C>
Service Groups (Overheads) $ 4,869 $ 26 $ 4,831 $ 12 154
Accounting 3,229 115 3,114 -- 57
Accounting Services 86 -- 86 -- 123
Corporate Communications 3,267 31 3,236 -- 51
Corporate Planning & Budgeting 2,276 1 2,275 -- 25
Corporate Services 995 -- 995 -- 19
Energy Delivery Support 10,912 -- 10,904 8 148
Energy Distribution 6,089 -- 6,089 -- 89
Energy Transmission 11,792 -- 11,786 6 185
Environmental Services 4,374 -- 4,374 -- 74
Executive Group 8,913 192 8,721 -- 88
Finance 1,135 223 912 -- 18
Fossil & Hydro Production 6,811 -- 6,810 1 98
Fuel Supply & Business Support 6,277 1 6,276 -- 75
Human Resources 10,156 -- 10,156 -- 153
Information Services 16,946 2 16,742 202 320
Internal Audits 3,181 -- 3,181 -- 49
Legal 3,827 175 3,652 -- 42
Marketing Services 4,675 241 4,434 -- 78
Northern RSO Production 13,300 -- 13,300 -- 253
Northern RSO Support 6,307 -- 6,307 -- 87
Nuclear Generation 16,626 -- 16,626 -- 137
Power Generation Engineering 20,489 -- 20,489 -- 325
Procurement & Supply Chain 4,317 -- 4,317 -- 82
Rates 2,029 -- 2,029 -- 29
Southern RSO Production 12,080 -- 12,080 -- 233
Southern RSO Support 3,384 -- 3,384 -- 62
System Planning 5,903 1 5,888 14 76
System Power Markets 3,746 -- 3,718 28 61
Tax 1,125 5 1,120 -- 20
TOTAL $199,116 $1,013 $197,832 $271 3,211
</TABLE>
<PAGE>
27
<TABLE> ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
<S> <C> <C>
ABB Power T&D Company Inc. NA $ 1,363
Software license fee applicable to AEP s System Control Center.
Abby Lane/Dana Temporaries, Inc. NA 111
Temporary office help.
America s Registry, Inc. NA 827
Professional services fees for computer programmers/systems analysts.
Analysts International Corporation NA 1,003
Professional services fees for computer programmers/systems analysts.
ASAP Software Express, Inc. NA 747
PC software and license fees.
Avnet Computer NA 164
PC software and license fees.
Barakat & Chamberlin, Inc. NA 117
Professional services fees and reimbursable expenses for marketing support.
Bentley Systems, Incorporated NA 152
PC software and license fees.
BGS Systems, Inc. NA 122
PC software and license fees.
C. W. Costello and Associates, Inc. NA 204
Professional services fees for computer programmers/systems analysts.
(Cont'd)
</TABLE>
<PAGE>
27A
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
<S> <C> <C>
Cambridge Energy Research Associates, L.P. NA 485
Professional services fees in support of strategic planning initiatives.
CAP Gemini America NA 1,350
Professional services fees for computer programmers and systems analysts.
CDI Corporation NA 586
Professional services fees for design and drafting services.
Center on Education & Training for Employment, The Ohio
State University NA 239
Professional services fees for development and delivery of training programs.
Clay Whitehead Associates NA 229
Consulting services related to telecommunications technology.
Clean Air Capital Markets Limited Partnership NA 137
Consulting services related to allowance tracking.
Commercial Movers, Inc. NA 437
Moving services for office furniture and equipment.
Computer Services Corporation NA 3,482
Consulting services related to the implementation of a marketing and
customer billing system.
Computer Associates International, Inc. NA 673
Software license and maintenance fees.
ComputerPeople, Inc. NA 3,656
Professional services fees for computer programmers/systems analysts.
(Cont'd)
</TABLE>
<PAGE>
27B
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
<S> <C> <C>
Compuware Corporation NA 785
Software license fees for PCs and database servers.
Coopers & Lybrand L.L.P. NA 1,035
Professional services fees and reimbursable expenses related to the
development and implementation of an activity based management system.
Data Channel International, Inc. NA 172
Professional services fees and reimbursable expenses for management of
the Net View/AIX Integration Project.
DataSystems Group, Inc. NA 786
Professional services fees and reimbursable expenses related to the
development and implementation of a customer asset management system.
Dawson Personnel Systems NA 180
Temporary office help.
DB Microware, Inc. NA 237
License fees for meter reading reroute software.
Deloitte & Touche LLP NA 2,366
Professional services fees and reimbursable expenses related to
reengineering of key accounting processes.
DP Initiatives, Inc. NA 137
Professional services fees for computer programmers/systems analysts.
EA Systems, Inc. NA 516
Professional services fees and reimbursable expenses related to the
development and implementation of automated engineering process
information management system.
(Cont'd)
</TABLE>
<PAGE>
27C
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
<S> <C> <C>
Egghead Software NA 299
PC software and license fees.
Electric Power Research Institute NA 354
Funding for research and development.
Electronic Data Systems NA 118
Software license fees.
Everest Data Research, Inc. NA 230
Professional services fees related to database management.
First Banks NA 108
Professional services acquired through AEPSC s procurement card program.
The Franklin Computer Services Group NA 485
Professional services fees for PC support services.
Gartner Group Inc. NA 130
Professional services fees for research advisory services.
Hameroff/Milenthal/Spence, Inc. NA 107
Professional services fees related to marketing, communications,
advertising and public relations services.
International Business Machines Corporation NA 1,425
Professional services fees and reimbursable expenses for computer
programmers/systems analysts.
Indecon, Inc. NA 1,093
Professional services fees for computer programmers/systems analysts.
(Cont'd)
</TABLE>
<PAGE>
27D
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
<S> <C> <C>
Information Builders, Inc. NA 211
Annual maintenance fees for computer software.
Information Industries, Inc. NA 258
Professional services fees for computer programmers/systems analysts.
Interactive Business Systems, Inc. NA 136
Professional services fees for computer programmers/systems analysts.
Intergraph Corporation NA 185
PC software and license fees.
Linesoft Inc. NA 174
Software license fees related to transmission line design.
Manifest Solutions Corp. NA 107
Professional services fees and reimbursable expenses for computer
programmers/systems analysts.
Manugistics, Inc. NA 185
Software license fee for demand and distribution planning software related
to procurement and supply chain services.
Market Strategies, Inc. NA 258
Professional services fees in support of marketing activities.
Marriott Management Services Corp. NA 103
Fee for food service operations.
Maximation, Incorporated NA 1,084
Professional services fees for computer programmers/systems analysts.
(Cont'd)
</TABLE>
<PAGE>
27E
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
<S> <C> <C>
Mercer Management Consulting NA 4,334
Professional services fees and reimbursable expenses for management
consulting services.
National Decision Systems NA 147
Computer database license fees.
National Economic Research Associates, Inc. NA 165
Professional services fees and reimbursable expenses for consulting economists.
NewMedia, Inc. NA 517
Professional services fees and reimbursable expenses for computer
programmers/systems analysts.
Novadigm NA 187
Software license fees for server and clients.
Office Team NA 185
Temporary office help.
The Ohio State University NA 435
Educational services for management development program.
Oracle Corporation NA 547
Technical support fee for client/server applications.
Origin Technology In Business, Inc. NA 1,156
Professional services fees.
PeopleSoft, Inc. NA 1,247
Software and software support services.
(Cont'd)
</TABLE>
<PAGE>
27F
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
<S> <C> <C>
PHH Homequity NA 4,054
Service fees for the purchase and sale of the homes of relocated employees.
Pitney Bowes Credit Corporation NA 379
Software license fee.
Primavera Systems, Inc. NA 153
Software and software license fees.
The ProTec Group, Inc. NA 781
Professional services fees for computer software programmers/systems analysts.
Quick Solutions, Inc. NA 412
Professional services fees for computer software programmers/systems analysts.
Raytheon Engineers & Constructors, Inc. NA 153
Professional services fees for engineering support.
Response Center NA 244
Consulting services in support of consumer market planning.
Robert Half International, Inc. NA 345
Professional services fees for computer software programmers/information
technology specialists.
Sales Management Systems, Inc. NA 114
Consulting/training services in support of business development program.
Sanwa Business Credit Corporation NA 211
Computer software license fee.
(Cont'd)
</TABLE>
<PAGE>
27G
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
<S> <C> <C>
Sarcom Inc. NA 1,780
Hardware and software support for LAN-based PCs.
Scott, Madden & Associates, Inc. NA 520
Professional services fees and reimbursable expenses for strategic planning
and analysis.
SE Technologies, Inc. NA 1,297
Professional services fees and reimbursable expenses for engineering and
design.
Shaffer Sherman Sperry & Swadding, Inc. NA 528
Professional services fees and reimbursable expenses for development
and delivery of training programs.
Siebel Systems, Inc. NA 350
Software license/consulting fees.
Software AG NA 400
Software maintenance fees.
Software Architects, Inc. NA 474
Professional services fees and reimbursable expenses for computer
programmers/systems analysts.
Software Spectrum NA 290
PC Software licenses.
Software Support Group NA 1,692
Professional services fees for computer programmers/systems analysts.
(Cont'd)
</TABLE>
<PAGE>
27H
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
OUTSIDE SERVICES EMPLOYED
ACCOUNT 923
INSTRUCTIONS: Provide a list, by vendor, of outside services employed. If the
aggregate amounts paid to any one vendor is less than $100,000, only
the aggregate number and total amount of all such payments need be
shown. Provide a brief one line description for the largest invoice
paid to each vendor listed.
RELATIONSHIP
"A"=ASSOCIATE
FROM WHOM PURCHASED "NA"=NON AMOUNT
ASSOCIATE
(In Thousands)
<S> <C> <C>
Sterling Software, Inc. NA 271
Software license fees.
Storage Management Division/Sterling Software, Inc. NA 124
Software license fees.
Strategic Resources, Inc. NA 544
Professional services fees for computer programmers/systems analysts.
Tangram Enterprise Solutions NA 124
Software license fees.
Tesseract Technology NA 257
Software license and maintenance fees.
Thomas Glover Associates, Inc. NA 130
Professional services fees for computer programmers/systems analysts.
Top Down Systems Corporation NA 191
Software license and maintenance fees.
Vinkad Services Inc. NA 162
Professional services fees for computer programmers/systems analysts.
585 Vendors under $100,000 7,040
Self-Assessed State Sales and Use Taxes on above 198
TOTAL $61,486
</TABLE>
<PAGE>
28
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
EMPLOYEE PENSIONS AND BENEFITS
ACCOUNT 926
INSTRUCTIONS: Provide a listing of each pension plan and benefit program provided
by the service company. Such listing should be limited to $25,000.
D E S C R I P T I O N AMOUNT
(In Thousands)
<S> <C>
Medical Insurance $11,592
Deferred Compensation Benefits 192
Other Postretirement Benefits 6,929
Savings Plan 4,327
Supplemental Savings Plan 130
Supplemental Pension Plan 11,226
Moving Expenses 6,249
Retirement Plan 4,878
Long-Term Disability 1,245
Group Life Insurance 848
Dental Insurance 995
Employee Educational Assistance 331
Miscellaneous 927
(Note: Certain line items include trustee fees.)
TOTAL $49,869
</TABLE>
<PAGE>
29
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
GENERAL ADVERTISING EXPENSES
ACCOUNT 930.1
INSTRUCTIONS: Provide a listing of the amount included in Account 930.1,
"General Advertising Expenses", classifying the items according
to the nature of the advertising and as defined in the account
definition. If a particular class includes an amount in excess
of $3,000 applicable to a single payee, show separately the name
of the payee and the aggregate amount applicable thereto.
D E S C R I P T I O N NAME OF PAYEE AMOUNT
None
TOTAL $ -0-
<PAGE>
30
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
MISCELLANEOUS GENERAL EXPENSES
ACCOUNT 930.2
INSTRUCTIONS: Provide a listing of the amount included in Account 930.2,
"Miscellaneous General Expenses", classifying such expenses
according to their nature. Payments and expenses permitted by
Section 321 (b) (2) of the Federal Election Campaign Act, as
amended by Public Law 94-283 in 1976 (2 U.S.C.S 441 (b) (2))
shall be separately classified.
D E S C R I P T I O N AMOUNT
(In Thousands)
<S> <C>
Directors' Fees and Expenses $ 7
Dues for Company Memberships 836
Other General Expenses 444
TOTAL $1,287
</TABLE>
<PAGE>
31
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
RENTS
ACCOUNT 931
INSTRUCTIONS: Provide a listing of the amount included in Account 931, "Rents",
classifying such expenses by major groupings of property, as defined
in the account definition of the Uniform System of Accounts.
T Y P E O F P R O P E R T Y AMOUNT
(In Thousands)
<S> <C>
Computers and Data Processing Equipment $15,944
Microwave and Telecommunication Equipment 965
Office Furniture and Equipment 924
Office and Parking 2,752
Software 2,405
Videotex and Timesharing 415
Miscellaneous 131
TOTAL $23,536
</TABLE>
<PAGE>
32
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
TAXES OTHER THAN INCOME TAXES
ACCOUNT 408
INSTRUCTIONS: Provide an analysis of Account 408, "Taxes Other Than Income
Taxes". Separate the analysis into two groups: (1) other than
U.S. Government taxes, and (2) U.S. Government taxes. Specify
each of the various kinds of taxes and show the amounts thereof.
Provide a subtotal for each class of tax.
K I N D O F T A X AMOUNT
(In Thousands)
<S> <C>
1. Taxes Other Than U.S. Government Taxes
NY State Franchise $ 61
State Unemployment 269
Ohio Corporation Franchise (393)
Ohio Real Estate Assessment 1,482
Ohio Intercounty Return of Taxable
Business Property 290
Miscellaneous Taxes 22
Sub-Total Taxes Other Than U.S. Government Taxes 1,731
2. U.S. Government Taxes
Federal Environmental Excise (7)
Social Security 12,833
Federal Unemployment 200
Sub-Total U.S. Government Taxes 13,026
TOTAL $14,757
</TABLE>
<PAGE>
33
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
DONATIONS
ACCOUNT 426.1
INSTRUCTIONS: Provide a listing of the amount included in Account 426.1,
"Donations", classifying such expenses by its purpose. The
aggregate number and amount of all items of less than $3,000
may be shown in lieu of details.
NAME OF RECIPIENT PURPOSE OF DONATION AMOUNT
(In Thousands)
<S> <C> <C>
American Forestry Association Community $ 20
Arthritis Foundation Community 10
Ballet Metropolitan Community 13
Boy Scouts of America Community 6
Center of Science & Industry Community 200
Central State University Matching Contribution 3
Columbus Arts Stabilization Community 67
Columbus Jewish Federation Community 5
Columbus Museum of Art Community 7
Columbus State Community College Educational 5
Columbus Symphony Orchestra Community 20
Columbus Urban League Community 5
Columbus Zoo Community 10
Community Action Community 5
Consumer Energy Council of America
Research Foundation Community 50
Cris Foundation Community 25
Electric Information Council, Inc. Community 5
The Family Y of Lancaster and Fairfield
County Community 5
First Ladies Library Community 10
Franklin University Educational 4
Great Lakes Water Quality Community 7
Greater Columbus Habitat Community 18
Greater Kanawha River Clean-up Community 5
Homeless Families Foundation Community 5
I Know I Can Educational 5
The King Arts Complex Community 9
Lehigh University Matching Contribution 4
Mid-Ohio Food Bank Community 10
The Nature Conservancy Community 25
Ohio Chamber of Commerce Community 10
Ohio Dominican College Educational 14
Ohio Foundation of Independent Colleges, Inc. Educational 26
Ohio River Sweep Community 5
Ohio River Valley Water Sanitation Commission Community 10
The Ohio State University Educational 60
Ohio University Foundation Matching Contribution 3
Olivedale Senior Citizens of Fairfield
County, Inc. Community 5
Opera Columbus Community 10
SUB-TOTAL 706
(Cont'd)
</TABLE>
<PAGE>
33A
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
DONATIONS
ACCOUNT 426.1
INSTRUCTIONS: Provide a listing of the amount included in Account 426.1,
"Donations", classifying such expenses by its purpose. The
aggregate number and amount of all items of less than $3,000
may be shown in lieu of details.
NAME OF RECIPIENT PURPOSE OF DONATION AMOUNT
(In Thousands)
<S> <C> <C>
Sub-Total Brought Forward 706
Rensselaer Polytechnic Educational 21
Resources for the Future Community 15
Rosemont Center Community 3
St. Stephens Community House Community 4
Spirit of the Valley Community 5
U.S. Navy Memorial Foundation Community 4
United Way Community 111
Utilitree Community 100
Utility Business Education Coalition Educational 5
Virginia Polytechnic Institute Educational 14
Virginia Tech Foundation, Inc. Matching Contribution 9
Volunteer Ohio Community 4
YMCA of Central Ohio Community 20
YWCA Capital Campaign Community 10
West Virginia Economic Development Corporation Community 20
Wilds, The Community 5
Women Executives in State Government Community 5
Employees and Others (Salaries, salary related
expenses, overheads and other expenses) Community 59
Miscellaneous - 252 items of less than $3,000 Various 168
TOTAL $1,288
</TABLE>
<PAGE>
34
<TABLE>
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
<CAPTION>
OTHER DEDUCTIONS
ACCOUNT 426.5
INSTRUCTIONS: Provide a listing of the amount included in Account 426.5,
"Other Deductions", classifying such expenses according to
their nature.
D E S C R I P T I O N NAME OF PAYEE AMOUNT
(In Thousands)
<S> <C> <C>
Cash Contributions: American Council For Capital
Formation-Center For
Policy Research $ 3
American Legislative Exchange 6
American Nuclear Society 2
Business Government Relations 1
Central & South West Corp. 34
Chamber of Commerce 43
Citizens of Strong Schools 5
Citizens of Stronger Ohio 5
Citizen s Committee for Children 1
Committee for Economic Development 1
Concord Coalition 1
Consumers United For Rail Equity 5
Council of State Governments 10
Electric Transportation Coalition 4
Friends of ADAMH 3
National Chamber Litigation
Center, Inc. 5
National Endangered Species Act
Reform Coalition 23
National Energy Resources Organization 2
National Environmental Policy Institute 1
National Governors Association 12
Points of Light Foundation 1
Virginia Manufacturers Association 2
Service Fees: American Contental Group, Inc. 10
Business Roundtable 39
The Capitol Connection 1
Oliphant Washington Service 2
The Success Group, Inc. 20
J. D. Womack 3
Salaries, salary related expenses,
overheads, and other expenses Employees and Others 1,207
TOTAL $1,452
</TABLE>
<PAGE>
35
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
SCHEDULE XVIII
NOTES TO STATEMENT OF INCOME
INSTRUCTIONS: The space below is provided for important notes
regarding the statement of income or any account
thereof. Furnish particulars as to any significant
increase in services rendered or expenses incurred
during the year. Notes relating to financial
statements shown elsewhere in this report may be
indicated here by reference.
See Notes to Financial Statements on Page 19.
<PAGE>
36
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
ORGANIZATION CHART
Chairman, Chief Executive Officer & President
Legal
Nuclear Generation
EVP - Administration & Chief Accounting Officer
Accounting Services
Corporate Accounting
Corporate Planning & Budgeting
Corporate Services
Human Resources
Information Services
Procurement and Supply Chain Services
Tax
EVP & Chief Financial Officer
Finance
Internal Audits (NOTE)
System Planning
System Power Markets
EVP
Corporate Communications
Marketing Services
Rates
EVP - Power Generation
Environmental Services
Fossil and Hydro Production
Fuel Supply & Business Support
Northern RSO Production
Northern RSO Support
Power Generation Engineering
Southern RSO Production
Southern RSO Support
EVP - Energy Delivery
Energy Delivery Support
Energy Distribution
Energy Transmission
NOTE: Internal Audits reports to the Audit Committee
of the Board of Directors of American Electric
Power Company, Inc. and administratively to the
Executive Vice President & Chief Financial
Officer.
<PAGE>
37
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
METHODS OF ALLOCATION
Service Billings
Kilowatt Hours Sales (KWH) Ratio
Client Load Ratio
Generated Coal-Fired Kilowatt Hours Ratio
Number of Electric Customers Ratio
Number of Client Employees Ratio
Number of Company Employees by Group Ratio
Plant Investment Ratio
Level of Construction Ratio
Level of Construction - Production Ratio
Level of Construction - Transmission Ratio
Level of Construction - Distribution Ratio
Tons of Coal Acquired Ratio
Computer Resource Unit Ratio
Coal Company Combination Ratio
Coal-Fired Kilowatt Hours Generation Ratio
Transmission and Sub-Transmission Pole Miles Ratio
Plant Megawatt Capability Ratio
Fossil Plant Combination Ratio
Specific Identification Ratio
(based on known and pertinent factors)
Equal Share Ratio
Hydro Kilowatt Hours Generation Ratio
Number of Purchase Orders Written Ratio
Number of Invoices Processed Ratio
Total Annual Cost Ratio
Convenience Billings
Specific Identification Ratio
(based on known and pertinent factors)
Asset Ratio
Expense Budget Ratio
Contribution Ratio
Equal Share Ratio
Gross Annual Payroll Dollars Ratio
Coal Production Ratio
Kilowatt Hours Sales (KWH) Ratio
Number of Employees Ratio
Number of Customers Ratio
Number of Vehicles Ratio
<PAGE>
38
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
ANNUAL STATEMENT OF COMPENSATION FOR USE OF CAPITAL BILLED
April 25, 1997
Statement of the Amount of Interest on Borrowed
Capital and Compensation for the Use of Capital
Billed by American Electric Power Service Corporation
(AEPSC) for the Year Ended December 31, 1996
G. R. Knorr - Columbus
AEP System Accounting Managers and Corporate Planning and Budgeting
In accordance with Instruction 01-12 of the Uniform System of Accounts
prescribed by the Securities and Exchange Commission for Mutual Service
Companies and Subsidiary Service Companies under the Public Utility
Holding Company Act of 1935, as amended, this is an annual statement of
the amount of interest on borrowed capital and compensation for the use
of capital billed by AEPSC for the year ended December 31, 1996.
Exhibit A, attached hereto, shows your portion of the interest cost on
capital borrowed for working capital requirements. The method used to
allocate the cost to each System company was the Total Annual Cost Ratio
based on the total direct and indirect charges billed during the prior
year of 1995. The amount shown for each company equals the total charges
billed under Work Order No. 1200 during 1996.
In addition to the interest charges incurred for working capital, AEPSC
billed to all clients, as an indirect cost applicable to administrative
services, a total amount of $7,335,048.00 of interest cost and debt
expenses related to the mortgage notes on its headquarters building
located in Columbus, Ohio.
All interest charges incurred by AEPSC during 1996 were for borrowings
with unaffiliated companies. No amount was billed by AEPSC during 1996
as compensation for the use of equity capital, all of which is furnished
to AEPSC by its parent, American Electric Power Company, Inc.
G. R. Knorr
GRK rp
Attachment
cc: P. J. DeMaria
G. P. Maloney
L. V. Assante
I:\ADMIN\U1360\LETTER.WP
Note: The above annual statement was provided to each associate
company within the AEP system. Please refer to the
"Analysis of Billing - Associate Companies" appearing on
page 21 of this report for a listing of the associated
companies billed and the respective amounts (Account
457-3).
<PAGE>
39
ANNUAL REPORT OF AMERICAN ELECTRIC POWER SERVICE CORPORATION
For the Year Ended December 31, 1996
SIGNATURE CLAUSE
Pursuant to the requirements of the Public Utility Holding Company
Act of 1935 and the rules and regulations of the Securities and
Exchange Commission issued thereunder, the undersigned company has
duly caused this report to be signed on its behalf by the under-
signed officer thereunto duly authorized.
American Electric Power Service Corporation
(Name of Reporting Company)
By: /s/ Gerald R. Knorr
(Signature of Signing Officer)
Gerald R. Knorr - Assistant Controller
(Printed Name and Title of Signing Officer)
Date: 4/30/97
<TABLE> <S> <C>
<ARTICLE> OPUR2
<MULTIPLIER> 1,000
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<BOOK-VALUE> PER-BOOK
<NET-SERVICE-COMPANY-PROPERTY> 138,475
<TOTAL-INVESTMENTS> 23,578
<TOTAL-CURRENT-ASSETS> 92,429
<TOTAL-DEFERRED-DEBITS> 44,055
<OTHER-ASSETS-AND-DEBITS> 0
<TOTAL-ASSETS-AND-DEBITS> 298,537
<TOTAL-PROPRIETARY-CAPITAL> 1,350
<TOTAL-LONG-TERM-DEBT> 76,100
<NOTES-PAYABLE> 3,318
<NOTES-PAYABLE-ASSOCIATE-COMP> 0
<OTHER-CURR-AND-ACCRUED-LIAB> 179,424
<TOTAL-DEFERRED-CREDITS> 10,890
<DEFERRED-INCOME-TAX> 27,455
<TOT-LIABIL-AND-PROPRIET-CAP> 298,537
<SERVICES-ASSOCIATE-COMPANIES> 393,743
<SERVICES-NON-ASSOCIATE-COMP> 501
<MISC-INCOME-OR-LOSS> 321
<TOTAL-INCOME> 394,565
<SALARIES-AND-WAGES> 199,116
<EMPLOYEE-PENSION-AND-BENEFIT> 49,869
<OTHER-EXPENSES> 145,580
<TOTAL-EXPENSES> 394,565
<NET-INCOME> 0
<TOTAL-EXPENSES-DIRECT-COST> 346,673
<TOTAL-EXPENSES-INDIRECT-COST> 47,892
<TOT-EXP-DIRECT-AND-INDIRECT> 394,565
<PERSONNEL-END-OF-YEAR> 3,211
